The world's scientists have given their starkest warning yet that a failure to cut greenhouse gas emissions will bring devastating climate change within a few decades - and with perfect timing, an environmental fund has moved to the top of the performance tables for the first time.

CIS Sustainable Leaders trust is the best performer of 324 trusts in the UK All Companies sector, rising by 29.3% over the past year, more than double the 13.2% gain in the FTSE All Share and the 13.3% rise in the average trust. Over three years, the fund rose 88.6% against 57.5% for the average trust.

The trust is run by Mike Fox, who prefers to focus on the public's attitude towards climate change. "There's been a seismic shift over the last 12 months. Companies that can offer products or services that help others improve their environmental performance are seeing increasing levels of demand, and are a core element of the trust."

But there are aspects of CIS that will not appeal to the risk averse. It screens out a lot of companies such as tobacco, arms and animal testing to the point that Fox's investment universe consists of just 170 companies.

"We are very focused investors. We only hold 45-55 stocks in the fund. The biggest is AIM-listed, although we do have around 45% of the fund in FTSE 100 stocks as well." He adds that the number of companies seeking to improve their carbon footprint means the potential stock list is widening.

He avoids the tech-company bias of ethical and environmental funds that so hurt their performance during the bear market - including his own fund - called CIS Environ until 2004, which found its way onto advisers' dog fund lists in 2002/03 because of heavy reliance on tech stocks.

The fund has next to nothing invested in blue-sky tech stocks now. "We're rung all the time by renewable energy companies wanting us to invest. But our problem is that we just can't see where the earnings are going to come from."

One of his favourite stocks has been Scottish & Southern Energy. It raised eyebrows when it came into the portfolio, as it owns a large number of highly polluting coal plants. "We bought it because it is one of the largest wind power generators. But it was also spending a small fortune on reducing carbon emissions from its coal assets, spending around £500m on improving them environmentally."

However, thoughts of investing in nuclear energy assets were scotched by the fund's supporters.

Fox says he has had a lot of positions in utilities, which have performed well over the past year. "We had a big position in Scottish Power, the subject of an £11.6bn takeover by Iberdrola of Spain. Iberdrola likes its US alternative energy investments. We now expect to see a lot more 'green' merger and acquisition activity."

His biggest single investment is in Spice Holdings, which makes and installs water meters. In December it reported half-year pre-tax profits of £2.4m - 68% up on last year, with sales of its meters up 20%. It's an AIM-listed stock, with the share price up from 115p to 426p since August 2004.

However, the fund has failed to be much of a hit with investors. It is £154m in size, but that has taken 17 years to build. "We've started to see some inflows, but we've got a long way to go," says Fox.